Cancellous bone, also known as spongy bone or trabecular bone, is a softer, less dense bone that occurs at many locations in the human body, for example within the interior or at the ends of various bones and in the vicinity of bone joints. Non-bone tissue associated with cancellous bone may include vascular material, such as bone marrow and blood. Bone marrow has long been recognized as a source of mesenchymal stem cells, and bone marrow has been extracted and processed by centrifuging techniques to prepare a fraction enriched in such stem cells relative to the in-tact bone marrow. Cancellous bone and associated tissue may also be processed to recover mesenchymal stem cells. Cancellous bone and associated tissue have been subjected to collagenase digestion to remove soft tissue components associated with bone surfaces and resulting bone fragments have been cultured as explants to expand such stem cells for possible beneficial use. Collagenase-released cells from such digestion have also been cultured to expand the stem cells for possible beneficial use. These cultured cells represent a potential source of stem cells in larger numbers than obtainable by concentrating stem cells from bone marrow, and which would be useful for a variety of therapeutic applications. However, such culturing has traditionally involved a laborious and time-consuming procedure, and limits practical utility of cancellous bone and associated tissue as a source for stem cells.